Trying to settle a second mortgage with Real Time Resolutions

[Cbradford435]

Hello
To make a long story short. Bought my home in 2007 with an 80/20. 2008 Market tanked. My husband at the time worked in mortgage so funds tanked as well. We hired a mortgage specialists to help us out and his advise was to stop paying on the second and pay on the first. We did that and at about 6 months we refinanced the first and caught back up. In the meantime the second mortgage with Countrywide went bankrupt, saw nothing on our credit and went on paying the first as we were underwater anyway. Fast forward to a divorce and bankruptcy (which didn't show the second as well) and in 2017 guess who purchased the note I am sure for pennies on the dollar. Real Time Resolutions. I hired a lawyer right away, and we waited for them to make a deal. 2 years goes by to now, they are back in contact. I can currently refinance because of course there is now equity-in the house. The second sat in MERS all these years. The second was originally $72,000. There total with interest and late fees is $160,000. I owe $120,000 on the first. They want copies of my current mortgage statement with the principle balance? Why? We offered $10,000 for giggles they said NO. I told my lawyer please tell them I am not remodifieing or refinancing with them so they dont need that info to make a deal, and to offer them $50,000. Anyone have success Real Time??? Should I just file Chapter 13?

 

[Jzone]

You've already filed Chapter 7? And now want to file Chapter 13? Was the second mortgage included in bankruptcy?

 

[Cbradford435]

You've already filed Chapter 7? And now want to file Chapter 13? Was the second mortgage included in bankruptcy?

I filed chapter 7 and no neither I nor the lawyer caught the debt since it has been gone off my credit since 2008.

 

[Cbradford435]

I filed chapter 7 and no neither I nor the lawyer caught the debt since it has been gone off my credit since 2008.

And no I don’t want to file, I want to settle at a reasonable amount, but with all the equity I am not sure that will happen. chapter 13 is a last resort to produce an automatic stay if they proceed with foreclosure ...

 

[Jzone]

I filed chapter 7 and no neither I nor the lawyer caught the debt since it has been gone off my credit since 2008.

Unfortunately, you didn't have a good Chapter 7 bankruptcy lawyer. When you don't pay a debt, it simply does not go away. Even if it is not on your credit report. What did you think happened to the second mortgage after 2008?

By not including it in your original bankruptcy case, you are still responsible for the debt plus the lien remains on the property. Including it in bankruptcy would of released you from the debt, with only the lien remaining. That's when you either keep paying to stay in the house or just walk away and start over.

Unsecured debt, like credit cards, has a time limit to collect on. Most states its 6 years, but some are longer.

Debt secured by property, like a mortgage, is much easier to collect on for the long term or as in your case, simply have the lien assigned/or purchased. I filed Chapter 7 in 2011, not paying the 2nd, current on the 1st and the lien has been transferred to a debt collector.

Notice I said the lien, not the debt. I am not responsible for the debt, but the lien remains. Second lien holders can foreclose, but unlikely since they have to also pay off the first to begin foreclosure procedures. Legally, they are trying to release a lien, not collecting a debt. I recieve a payoff notice about twice a year from them and simply respond by letter with a 20% settlement offer and never hear back.

So now, you've got 2 problems. You still owe the debt and your lien holder wants $160,000 to settle. Here is what I would do:

1. Check with your county register of deeds and see who actually holds the lien. In most states you can do this online for free or walk into your county court house and get a copy for probably $5. You only need to negotiate with the lien holder.

2. If your loan balance was $72,000 with CountryWide, thats your starting point. The fact that they went bankrupt or charged off your loan means nothing to you. Charged off just means it was considered uncollectable to them. They still had the legal right to sell or transfer that debt. There stated balance of $160,000 is not relevant.

3. Keep current on your 1st mortgage if you want to stay in the house. Do not send the lien holder any of your financial information. Its not required to settle a lien. They will only use that information against you to show that you have the ability to pay more.

4. When you verify who holds the 2nd mortgage, contact them for a settlement only in writing. No phone calls, no email. Send it by certified reciept so you can show an attempt was made to settle. By already offering $10,000 to settle, they have no reason to accept any low ball offers.

5. Where is the ex husband in all of this? Surely his name is on the mortgage from 2007 and he is also responsible? Find out from your divorce lawyer. He or you may have been released from the debt during divorce proceedings.

6. Offer 30%-40% to settle. That's about $25,000. Your home has increased in value and they know it. See what the response is and remember no phone calls or emails. Letters only.

With the coronavirus taking its toll on the US, that may be a good sign for you. Housing prices are going to drop in the next 6 months and debt collectors will become easier to settle with. If foreclosure has not been threatened by them, simply keep paying your first and be willing to negotiate with the second. Again its unlikely they will foreclose but not unheard of.

Good luck and keep us updated.

 

[Cbradford435]

Thank you for your reply.
1. Yes I had already checked and they did in fact buy the note from MERS and filed an assignment in deed of trust.
2. Sorry it was New Century Mortgage and yes shame on me for thinking it disappeared. When I remodified first loan Into a HAMP loan they said the second would be forgiven. No I didn’t check
3. First loan as been current since 2010
4. Lawyer handling all this and already had me file loss misigation paperwork and give them a copy of current loan status and principle balance in which I argued with her about .
5. Ex was quit claimed off deed and could care less about this debt
6. I am primed and ready at the drop of a hat to refinance once they make an offer and I am ready to accept at least the full original amount ..
Just want this over with so the home is free and clear and in my name. And yes part of me is thinking, damn you guys better move fast or nothing is going to happen for sometime with COVID 19 and a recession.l my home could very well go back under water ...